CarMax, the nation’s largest retailer of used vehicles, just reported very strong results in used car sales for it recently ended fiscal year and fourth quarter. It was a record-breaking sales year for CarMax.
It was the first fiscal year the company ever retailed more than 500,000 vehicles as it saw a nearly 20% gain in used vehicle sales. Total used units increased 12% in the fourth quarter and 18% for the fiscal year. The retail chain sold 526,929 used units for the fiscal year and 132,856 in its fourth quarter.
Earnings for used vehicles sold also saw an increase for CarMax. Used vehicle gross profit came in at $284.4M in Q4 – up from $253.3M during Q4 2013.
An increase in vehicle lending has helped driver profits at many dealerships. At the end of 2013, CarMax said it would start lending to subprime borrowers to increase its revenue and profits with credit-challenged customers – and it’s a channel for increasing sales of older-model used vehicles.
Tom Folliard, president and CEO of CarMax, made a few points on the company’s fiscal year used car profits:
• CarMax’s comparable store used unit sales growth of 12% was its strongest since fiscal year 2002.
• The company believes that its continued geographic expansion and market share growth will drive its success in years to come.
• CarMax was able to end the year strongly even though harsh weather conditions through everything off in January and February. Folliard said there was one day when over 30 of its stores were closed, along with days when the entire Dallas market closed. Historically, CarMax has experienced that it will eventually get those sales back.